The defendant, King Packaged Materials Company, brought a motion for summary judgment to dismiss the plaintiff's (Construction Distribution & Supply Co. Inc.) action for insufficient termination notice of a distribution agreement and to grant its counterclaim for unpaid products.
The court found that the unwritten, non-exclusive distribution agreement, which lasted 18 years, implied a term for reasonable notice of termination based on industry custom.
Considering factors such as the plaintiff's low dependence on the defendant's products (less than 5% of total sales) and lack of substantial investment, the court determined that the three months' notice provided by the defendant was reasonable.
Consequently, the plaintiff's claim for damages was dismissed, and the defendant's counterclaim for $93,890.49 plus interest for unpaid products was granted.